The pulp and paper industry comprises manufacturing enterprises that convert cellulose fibre into a wide variety of pulps, papers and paperboards. About 95% of their fibre comes from wood from Canadian FORESTS, the balance from wastepaper and a very small quantity of linen and cotton rags. Wood is reduced to fibre by mechanical means or by cooking in chemicals. The fibres are then mixed with water, adhering to one another as the water is removed by pressure and heat. This is the fundamental principle of papermaking, discovered by the Chinese nearly 2000 years ago and brought to Spain by the Moors, probably during the 12th century.
Papermaking today is a large, capital-intensive industry, characterized by high-speed machines and complex systems of control for manufacturing to close tolerances thousands of products vital to education, communications, marketing, packaging, construction, etc. Canada today ranks second to the US in pulp and paper manufacture, and first in pulp and paper exports. It has about 140 pulp, pulp and paper, and paper mills, every province except Prince Edward Island having at least one.
Pulp and paper production in the mid- to late 1980s has been valued at some $14 billion annually and has accounted for about 3% of the Gross Domestic Product. Exports of around $11 billion have comprised about 9% of total Canadian exports. The industry is the largest of Canada's manufacturing industries, with about 85 000 workers in mills and offices, some $2.8 billion paid in wages and salaries and some $6 billion in value added by manufacture. Furthermore the industry makes a net contribution to Canada's BALANCE OF PAYMENTS of some $8 billion, larger than that of any other Canadian industry.
The first Canadian paper mill was completed in 1805 at St Andrews [Québec], by 2 entrepreneurs from New England. It produced printing, writing and wrapping papers for sale mostly in the growing markets of Montréal and Québec City. Sites chosen for early mills were on rivers or streams, which provided water necessary for papermaking processes and waterpower to run machinery. Waterways also provided a convenient means of transporting raw materials (rags) to the mill and finished goods to markets.
Throughout the 19th century, pulp and paper was largely a domestic industry, serving the gradually increasing needs of Canadians. As literacy spread and commercial and industrial activity quickened, the need for cultural and packaging papers grew. Many new mills were established along the Great Lakes-St Lawrence system and its tributaries and in the Maritimes.
For many centuries the traditional source of cellulose fibre for paper manufacture had been cotton and linen rags. The full potential of a Canadian pulp and paper industry based on a vast forest resource began to be realized only after the discovery of how to make paper from wood (around 1840). Alexander Buntin is credited with inaugurating Canada's groundwood mill at Valleyfield, Québec (now Salaberry-de-Valleyfield). Groundwood, prepared by grinding the wood, is used primarily for inexpensive papers, such as newspaper. The exact date for Buntin's mill is not known, but he had 2 grinders imported from Germany in operation by 1869.
The first chemical wood-pulp mill in North America was built by Angus & Logan at Windsor Mills, Québec, in 1864. It was erected under the supervision of John Thomson, a Scot who had conducted experiments in Saint John, New Brunswick. Chemical pulp is prepared from wood chips boiled under pressure with chemicals - Thomson used soda - to leave mostly cellulose fibre. The wood pulp is washed, bleached, blended and then poured over a wire screen, leaving a fine layer of fibre. Wood pulp then gradually displaced rag pulp for most uses, and the era of modern papermaking began.
Two developments, both occurring within a relatively short period, moved Canada onto the world papermaking stage. The first, in the 1890s and early 1900s, was the prohibition of exports of pulpwood from crown lands, applied by provincial governments.
The second was the removal of the US tariff on newsprint in 1913. These actions stimulated large investments in Canadian pulp and papermaking for foreign markets and set the industry on the course it has followed ever since. By the end of WWI, Canada had already become the world's largest exporter of pulp and paper.
Each subsequent decade of the industry's history has had its particular flavour. Rapid growth took place in the 1920s, especially in northwestern Ontario and the St-Maurice Valley, Ottawa Valley and Lac Saint-Jean regions of Québec. Mills were sited in northern locations that offered hydroelectric power potential as well as spruce stands. Establishment of a mill frequently necessitated development of a townsite such as KENORA, Ontario (see RESOURCE TOWNS). Expansion was followed by the worldwide depression of the 1930s, when some companies went bankrupt and most others were in very serious financial straits.
WWII brought a return to higher levels of activity and even some expansion as European wood-pulp supplies that had formerly served the US market became unavailable. The postwar economic boom arrived in the late 1940s, continuing almost uninterrupted through to the late 1950s. Pulp and paper companies, by now fully restored to financial health, refurbished their manufacturing operations, steadily raised shipments and exports and, for a number of years, ran at maximum capacity.
With the 1960s came the greatest surge of expansion in the industry since the 1920s. It occurred everywhere, but the pacesetter was BC. Canadian and foreign interests, spurred by provincial governments eager for new industrial investment, scrambled to participate as large areas of public forestland were made available. Sixteen new mills opened between 1965 and 1970, mostly for the production of bleached kraft pulp for world markets.
The 1970s were a turbulent period for the industry, marked by greatly intensified competition in international markets, periods of worldwide overcapacity, a deep recession in mid-decade, large changes in currency exchange rates, rapidly rising inflation throughout the industrial world and a decline in the competitiveness of the Canadian economy as a whole.
Nevertheless, as the decade ended, devaluation of the Canadian dollar had helped restore the competitive strength of the pulp and paper industry, and large programs of mill modernization were under way in every region.
The early 1980s brought other abrupt changes: a deep recession and sharp cutbacks in pulp and paper production. This was followed by economic recovery, a sustained period of moderate growth in major markets in the middle and later years of the decade, and the prospect of substantial future growth in worldwide use of pulp and paper. This prospect was accompanied by the knowledge that the Canadian industry would continue to face intense competition in all its traditional markets.
In quantity, Canada's pulp and paper shipments now total about 23 million t: about 40% is newsprint, of which Canada has been the world's largest producer for over 50 years; about 37% is wood pulp, for further processing into paper and paperboard; 23% is a wide variety of packaging papers and boards, book and writing papers, tissue and sanitary papers and building papers and boards.
Some 79% of Canadian production is exported; 21% is used in Canada. The largest export market has for many years been the US, which now absorbs about 52%. Western Europe takes about 12%; Japan some 5%; all other world markets together about 10%. Nearly 87% of exports consists of newsprint and wood pulp, which have entered the major world markets duty free for many years.
Historically, other papers and paperboards have encountered tariffs around the world and, partly for this reason, have been manufactured largely for use within Canada. Although this situation is now changing, as a result of successive rounds of multilateral tariff reductions negotiated through the GATT, newsprint and wood pulp remain the export staples of the Canadian industry, with various grades of printing papers other than newsprint increasing rapidly.
The pulp and paper industry uses about 90 million m3 of wood annually: over 90% is SPRUCE, FIR, PINE and other softwoods; the balance is hardwoods. Over the past 20 years the most significant development in the industry's fibre requirements has been the tremendous increase in the use of wood chips, reject lumber and other wood residues from sawmills.
Such residues now account for more than half of all wood used in Canadian pulp and paper mills, as compared with around 10% in the early 1960s. This development has meant a more efficient use of the forest resource and has stimulated greater integration of pulp and paper and lumber manufacture.
Québec accounts for the largest share of total production, about 35%; Ontario about 25%; BC about 22%; and the Atlantic and Prairie provinces together have some 18%. Most mills are located in communities near the forests from which they draw their chief raw material; some that purchase pulp for conversion into finished products or use mostly wastepaper have been built in the large metropolitan areas.
About 70% of Canada's pulp and paper is manufactured by companies that are controlled in Canada; some 23% comes from companies controlled in the US; and 7%, from companies controlled elsewhere. Canadian ownership is largely via the private sector. There has been some public-sector ownership by provincial governments or their agencies in Québec, Manitoba and Saskatchewan, but this amount represents only some 10-15% of the industry's total manufacturing capacity.
The major Canadian companies are ABITIBI CONSOLIDATED, British Columbia Forest Products Ltd, Canadian Forest Products Ltd, CIP Inc, Consolidated-Bathurst Inc, DOMTAR Pulp & Paper Products Group, Great Lakes Forest Products Ltd, Kruger Inc, MACMILLAN BLOEDEL LTD and Repap Enterprises Inc.
The pulp and paper industries of Canada and the other large producing regions of the world (eg, the US, Europe, Japan) have traditionally shared information on technological development. Hence, the major advances in wood harvesting, pulping and papermaking during the 20th century have tended to result from research work in several countries.
Canada has participated fully in these developments and has had a very important role in some of them, such as the chemical-recovery system used in alkaline pulping, which stimulated the growth of the kraft pulp industry all over the world; improved pulp-bleaching techniques, which opened new markets for many papers and paperboards; and twin-wire forming, one of the most significant developments in the papermaking process since the invention of the Fourdrinier machine in the first decade of the 19th century (see CHEMICAL ENGINEERING).
Scientific research is carried out by a number of Canadian pulp and paper manufacturers and the industry also carries on co-operative research through the Pulp and Paper Research Institute of Canada and the Forest Engineering Research Institute of Canada, both situated in Pointe-Claire, Québec. The industry makes large capital expenditures on air and water POLLUTION abatement; in recent years, $100-150 million annually. Mill effluent losses have been reduced substantially: suspended solids per tonne of production have dropped by 90%; biochemical oxygen demand, by 72%.